Grid Metals Corp V.GRDM

Grid compared to Snow Lake Lithium

[Mookster3]

Snow Lake recently published a preliminary economic assessment for their proposed lithium mine in northern Manitoba and 266p report is available on their website. The Snow Lake and Donner ore bodies are virtually the same (see below), consisting of subvertical pegmatite dykes, a few meters in thickness, that will see mostly underground mining. However, Donner is already road accessible and processing will occur at existing mills, so capital costs should be much less (see below) and timeframe for development should be shorter. Cost below for upgrading the True North mill ($10mm) is only a guess, but more detailed info should be available from Primero Engineering next month.
  

	Donner	Snow Lake
Tonnes (mm)	6.8 (2.1 open pit)	8.2 (0.6 open pit)
Grade % Li2O	1.39	1.1
Li2O (mm kg)	95,000	90,000
Initial Capital Costs (US$ mm)
Pre-production1	19	19
Mining fleet1	32	32
Ore sorting1	7	7
Mill	172	42
Road1	1	1
Power line	nil	18
Bridges	nil	15
Closure Costs	10	10
Total capital costs (mm $US)	$86	$146
Operating Costs
$/t mined1	33	33
Ore sorting ($/t mined)1	2	2
Mill processing ($/t milled)	23.53	16
Transport ($/t milled)	304	15
Admin ($/t milled)1	2	2
Total (US$/t milled)	90.5	68
Revenue
Li2O @6 % (US $/t)	$3500	$3500
Gross $/t milled @80% recov	$649	$513
Net $/t milled @80% recov	$559	$445
Milling rate t/d	?	2500
Revenue  ($US/yr)	?	$430 mm
Cash flow ($US/yr)	?	$355 mm
NPV post tax @ 7%  US$		1.2 B
IRR %		170%
Payback		1.2 yr
Market capitalization (US$)	$17mm	$32mm

1) Donner costs assumed the same as Snow Lake
2) Includes total lease payments to 1911 Gold over 10 yr period ($7mm) and assumed cost for upgrading True North mill ($10 mm).
3) Milling costs assumed same as Snow Lake plus $7.50/t toll milling fee paid to 1911 Gold
4) Transport costs assumed same as Snow Lake plus $15/t for ore transport to True North mill (82km).